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Friday, March 23, 2007

Who's Right?

Digital video recorders are wonderful. I was able to record former Vice President Gore's appearances before the House Energy and Commerce Committee and Science Committee and the Senate Committee on Environment and Public Works this Wednesday, watching most of his hours of testimony over the last couple of days. Aside from the expected debate over the details of global warming, which one Congressman characterized as being over in science but not in politics, another interesting dichotomy was also on display. In response to several questions on the merits of nuclear power in addressing the need for cleaner energy, Mr. Gore sketched out his vision of a much more networked and dispersed economy, in which central power generation plays a smaller role and so-called distributed power sources, including solar and wind energy, lead the way. It's tempting to come down on one side or the other of this debate, but like the one about alternative energy technology, the better answer probably lies with a blended solution.

Along with reprising most of the arguments from his Academy Award winning film, "An Inconvenient Truth", the former VP peppered his responses with interesting energy ideas, including the establishment of a federally-chartered Carbon-Neutral Mortgage Association, "Connie-Mae", to underwrite energy efficient home construction features that the market won't yet value in the selling price of a new house. He also pushed the idea of a smart, networked power grid to accommodate small, distributed generation from cleaner, more efficient sources. It's an appealing picture, and one that I first encountered a decade ago, in my energy scenario work. There are lots of benefits of this sort of approach, particularly in countries that are growing rapidly and have to build new energy infrastructure, anyway. Our own power grids are evolving in this direction, with trends such as "net metering", and they will need to, in order to adapt to the changing demands of their customers for higher quality, more reliable power.

However, even in this bright new world of decentralization, someone must still smelt aluminum, mill steel, build cars, and do all the other grimy, old-economy things upon which we still depend, some of us for our livelihoods, and the rest for our lifestyles. These activities require vast amounts of reliable, baseload power, of the kind that nuclear and coal-fired power plants excel at. Coal looks highly problematic in a carbon-constrained world, depending, as the new MIT study suggests, on the development and deployment of a largely untested carbon sequestration technology that will be very difficult to retrofit to existing plants. For this reason and others, nuclear energy is attracting more interest, globally.

Mr. Gore worked hard to avoid sounding rigidly anti-nuclear, focusing instead on concerns about waste storage--he opposes the Yucca Mountain waste facility--and the very large capital costs involved in building new nuclear plants. Yet despite these issues, we are likely to see the first new nuclear plant in this country in two decades get its permits within a few years. The cloud of uncertainly that the recent TXU deal has cast over new coal-fired power plants will inevitably improve the prospects for new nukes.

To refine a statistic tossed out by one Senator, in 2005 nuclear power contributed 68% of all the low-carbon electricity generated in the US. As we contemplate a cap on carbon emissions and a carbon tax or an emissions trading system--or both, as Mr. Gore advocated Wednesday--the market value of all those green electrons from wind, solar, hydropower and nuclear will go up significantly. I doubt we can rely exclusively on wind and solar energy to provide all the green electricity we'll need, and efficiency won't eliminate the role of central power plants. I'd be very surprised if the greener world we need to create didn't also feature a bigger contribution from nuclear power.